Cloudian today announced the creation of EDGEMATRIX, a majority-owned subsidiary led by Hiroshi Ohta, Cloudian co-founder. The new company will provide solutions for Artificial Intelligence (AI) processing of large-scale data sets at the edge, building on the innovation and momentum Cloudian has demonstrated in the Japanese AI market. EDGEMATRIX has raised $9 million in Series A funding from strategic investors NTT DOCOMO, INC., SHIMIZU CORPORATION and Japan Post Capital Co., Ltd. as well as Cloudian CEO and co-founder Michael Tso and Cloudian board director Jonathan Epstein. The new company will leverage Cloudian's HyperStore platform for managing large-scale data sets, data analytics, and machine learning use cases.

A Strong AI Foundation

EDGEMATRIX will initially focus on the Japanese market, where both the government and private sector view AI as essential to boosting productivity. According to IDC, spending on AI systems in Japan is expected to increase at a compound annual growth rate of 45.3% from 2018 to 2023, the strongest spending growth on a geographic basis.

EDGEMATRIX is well-positioned to capitalize on this opportunity. Building on Cloudian's expertise in software-defined solutions for managing large data sets, over the past two years Ohta and a small Cloudian team created a number of innovative AI software solutions and a low-cost, ruggedized device for AI applications processing and data collection at the edge. By applying analytics near where data is created (e.g., where sensors are located), the edge device enables real-time data analysis and decision-making while minimizing the transmission costs and latencies of public clouds.

These AI solutions have been deployed by a number of large companies and organizations for various use cases, including:

Targeted advertising - video analysis of the make, model and year of cars on a highway to display targeted ads on a nearby billboard.

Manufacturing quality inspection - identification and removal of products that failed to get wrapped in an automated assembly line process.

Traffic congestion measurement - counting of cars on a road as a basis for changing turn lanes to improve traffic flow.

Expanding Cloudian's Storage Footprint

EDGEMATRIX will both better position Cloudian to capitalize on the AI market opportunity and enable the company to expand its core object storage business.

AI solutions are insatiable consumers of data and therefore require a limitlessly scalable, highly cost-effective data storage and management foundation. Cloudian's HyperStore object storage platform will provide this foundation, allowing EDGEMATRIX appliances to send subsets of data analyzed at the edge to a central storage repository using the S3 API. In addition, because of its fully native S3 storage compatibility, Cloudian will give EDGEMATRIX customers the ability to manage this data seamlessly across on-premises and public cloud environments.

"In just a short time, we have built a compelling product, an initial base of top-tier customers and a range of strategic partnerships," said Ohta. "We will leverage these strengths, the new funding, and the collaboration with our strategic investors to bring the benefits of our solution to more enterprises, helping them derive greater value from their digital assets."

"Today's announcement reflects our continued leadership in delivering software-defined innovations that provide customers with the foundation they need to thrive in today's data-centric economy," said Tso. "By establishing the EDGEMATRIX subsidiary, we can align more closely with our strategic partners in AI while continuing to focus on building on our position as a leading provider of object storage and hybrid cloud solutions."